Bangalore District Court
With Plea Of Availing Property Loan By ... vs Issued Four Cheques. The First Cheque Is ... on 15 December, 2021
1 CC.25878/2017 (J)
IN THE COURT OF THE XV ADDL CHIEF METROPOLITAN
MAGISTRATE AT BANGALORE CITY.
Dated this the 15th day of December2021
Present: Lokesh Dhanapal Havale. B.A.L.L.B.,
XV Addl.C.M.M., Bangalore.
Judgment U/s.355 of the Cr.P.C. 1973.
1.Sl.No.of the case CC.No.25878/2017
2.Name of the Complainant: Sri.Manjunath.R.,
Son of late.M.R.Ranganna,
Aged about 44 years,
Residing at No.F24,
Corporation Khata No.92,
Right Side 5th Cross Road,
Magadi Road,
Bangalore560023.
3.Name of the accused: Sri.S.Umesh,
Son of Sampath Kumar,
Aged about 29 years,
Residing at No.59, 20th Cross,
6th Main Road,
Bhuvaneshwarinagar,
K.P.Agrahara, Magadi Road,
Bangalore560 023.
4.The offence complained of : U/s.138 of Negotiable Instruments
Act.
5.Plea of the accused: Pleaded not guilty.
6.Final Order: Acting U/s.255(2) Cr.P.C., accused is
Convicted.
7.Date of final Order 15.12.2021
***
2 CC.25878/2017 (J)
This complaint is filed U/Sec.200 of Cr.P.C. against the accused
for the offence punishable U/Sec.138 of the Negotiable Instruments
Act, 1881.
2. The facts of the complaint in brief are as under:
The complainant is the absolute owner of immovable property
bearing Corporation Khata No.92, Old Corporation 13th Division Ward
No.25, old PID No.255917, new PID No.121W005136/12,
Municipal No.17 situated at Magadi Road, 5 th Cross, Bengaluru
measuring East to West 18 ft and North to South 12 ft consisting of
RCC roofed house with civic amenities hereinafter referred as schedule
property. The schedule property was acquired by him under release
deed dated 20.04.2013 and it was registered vide document No.GAN1
00252201314, Book No.1, stored in CD.No.GAND156 in the office of
SubRegistrar, Gandhinagar, Bengaluru. He has right, title, interest and
possession of the schedule property. Accused approached the
complainant with plea of availing property loan by depositing the title
deeds of the schedule property. Considering the plea of the accused,
the complainant and his wife Smt.Geetha jointly executed mortgage
deed by deposit of title deeds on 29.05.2017. It was registered vide
document No.GAN101021201718, book No.1, stored in CD
No.GAND291 on 30.05.2017 in the office of SubRegistrar,
Gandhinagar, Bengaluru. The complainant agreed and given consent to
the accused to avail the loan from any financial institution to the tune
of Rs.25 lakhs. Pursuant to the mortgage deed dated 29.05.2017 the
accused issued four cheques. The first cheque is bearing No.388 dated
12.06.2017 for a sum of Rs.4 lakhs, the second cheque bearing
No.389, dated 20.06.2017 for a sum of Rs.4 lakhs, the third cheque is
3 CC.25878/2017 (J)
bearing No.390 dated 25.06.2017 for Rs.4 lakhs and the fourth cheque
is bearing No.391 dated 01.07.2017 for a sum of Rs.3 lakhs and they
are drawn on Karur Vysya Bank Ltd, Rajajinagar, Bengaluru. The
complainant presented the aforesaid cheques for encashment and they
were returned dishonoured with shara "Payment Stopped by Drawer"
on 20.06.2017, 29.06.2017, 29.06.2017 and 05.07.2017 respectively.
The complainant is entitled to claim interest @ 24% p.a. from the date
of cheques till the realization. He issued legal notice to the accused on
11.07.2017 and it was duly served on 12.07.2017. The accused issued
reply notice on 15.07.2017 by assigning false frivolous and evasive
reasons. Even after expiry of 15 days the accused did not pay the
amount. Hence prayed to punish the accused and compensate the
complainant.
3. After the institution of the complaint, cognizance was
taken and the case has been registered as PCR No.10002/2017. The
sworn statement of the complainant was recorded and on the basis of
sworn statement and other materials on hand, the criminal case was
registered against the accused and summons was issued to him. In
response to the service of summons, the accused appeared before the
Court through his learned counsel and got enlarged on bail. The
prosecution papers supplied to the accused and the substance of
accusation for the offence punishable U/s.138 of Negotiable
Instruments Act was read over to the accused. He pleaded not guilty
and claimed to be tried.
4. During trial the complainant examined as PW1 and got
marked Ex.P.1 to P.14. The statement of the accused U/s. 313 of
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Cr.P.C. was recorded. The accused lead defence evidence and examined
as DW1 and got marked Ex.D.1 to D.4.
5. I have heard the arguments of both learned counsels and
perused the entire materials. The following points would arise for my
consideration.
1. Whether the complainant proves that the accused
issued 4 cheques, the cheque bearing No.000388
dated 12.06.2017 for a sum of Rs.4 lakhs, the
cheque bearing No.000389, dated 20.06.2017 for a
sum of Rs.4 lakhs, the cheque bearing No.000390
dated 25.06.2017 for Rs.4 lakhs and the cheque
bearing No.000391 dated 01.07.2017 for a sum of
Rs.3 lakhs and they are drawn on Karur Vysya Bank
Ltd, Rajajinagar, Bengaluru in his favour towards
the discharge of legally enforceable debt/liability
and on their presentation for encashment, they
were dishonored with an endorsement of "Payment
Stopped by Drawer" and the accused has not paid
the amount even after 15 days from the date of
service of notice and thereby accused committed an
offence punishable U/Sec.138 of N.I. Act, 1881 ?
2. Whether the accused rebuts the presumption
U/s.139 of N.I.Act?
3. What order?
5 CC.25878/2017 (J)
6. My answers to the above points are as under.
Point No.1 : In the Affirmative
Point No.2 : In the Negative
Point No.3 : As per final order for the following;
REASONS
7. Point No.1 & 2: The points are taken together for discussion
to avoid repetition of facts and evidence. At this juncture, it is necessary
to go through the provisions of N.I.Act before proceeding further. The
provisions under Section 118(a) and 139 of the Act., 1881 are
extracted and they reads thus;
"118. Presumptions as to negotiable
instruments. - Until the contrary is proved,
the following presumptions shall be made:
(a) of consideration - that every
negotiable instrument was made or drawn
for consideration, and that every such
instrument, when it has been accepted,
indorsed, negotiated or transferred, was
accepted, indorsed, negotiated or
transferred for consideration.
(b) as to date: that every Negotiable
Instrument bearing date was made or drawn
on such date;
"139. Presumption in favour of holder.
It shall be presumed, unless the
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contrary is proved, that the holder of a
cheque received the cheque of the nature
referred to in section 138 for the discharge,
in whole or in part, of any debt or other
liability."
8. On plain perusal of the provisions under Section 118(a)
and 139 of the N.I.Act., as extracted herein above, it can be seen that
initially the presumptions constituted under these two provisions
favour the complainant. However, it is open to an accused to raise a
defence to rebut the statutory presumptions. An accused can raise a
defence, wherein the existence of legally enforceable debt or liability
can be contested.
9. It is also well established that an accused for discharging
the burden of proof placed upon him under a statute need not examine
himself. He may discharge his burden on the basis of the materials
already brought on record. An accused has constitutional rights to
maintain silence. Standard of proof on part of the accused and that of
the prosecution in a Criminal case is different. The prosecution must
prove the guilt of an accused beyond all reasonable doubts, the
standard of proof so as to prove a defence on the part of an accused is
"Preponderance of probabilities".
10. Under the light of above extracted provisions of the Act, I
have perused the oral and documentary evidence on record. In order to
prove his case the complainant examined himself as PW.1 and got
marked Ex.P.1 to P.14. Ex.P.1 is the certified copy of the Mortgage
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deed by way of deposit of title deeds dated 29.05.2017 executed by
complainant and his wife by name Smt.Geetha in favour of the accused
mortgaging the schedule property. The complainant executed Ex.P.1
for obtaining loan of Rs.25 lakhs. It is mentioned in the Ex.P.1 that the
complainant received Rs.25 lakhs loan through Bank. Ex.P.2 is the
encumberance certificate Form No.15. It shows that on 30.05.2017
release deed was executed by General Manager, The Bengaluru City
Cooperative Bank Ltd, Chamarajpet, Bengaluru in respect of schedule
property for consideration of Rs.5,70,000/. Ex.P.3 to 5 are the cheques
dated 12.06.2017, 20.06.2017 and 25.06.2017 for Rs.4,00,000/ each
and ExP.6 is the cheque bearing No.000391 dated 01.07.2017 for
Rs.3,00,000/ and Ex.P.3(a) to ExP.6 (a) are the signatures of the
accused on the cheques. Ex.P.7 to 10 are the Bank endorsements dated
20.06.2017, which was issued with a Shara "Payment Stopped by
Drawer". Ex.P.11 is the office copy of the statutory notice dated
11.07.2017. Ex.P.12 is the Postal acknowledgement for having served
notice on accused on 12.07.2017. ExP.13 is the reply notice dated
15.07.2017. Ex.P.14 is the statement of Bank account of the
complainant.
11. I have perused the exhibits on which the complainant has
placed his reliance. It is admitted fact that the complainant and accused
knew each other very well. On perusal of the exhibits, it is clear that
the cheques at Ex.P.3 to 6 were presented through the Bank within its
validity for encashment and the Bank issued endorsements as per
Ex.P.7 to 10 with shara "Payment Stopped by Drawer". In the
Judgment of Hon'ble Supreme Court of India in the case of Electronics
Trade & Technology Development Corporation Ltd, Secunderabad
8 CC.25878/2017 (J)
Vs.Indian Technologists and Engineers (Electronics) Pvt Ltd reported
(1996) 2 SCC 739, it was held that the drawer of cheque having
insufficient funds to his credit cannot escape liability U/s.138 of N.I.Act by
issuing stop payment instructions to his Bank. Further in the Judgment
of Hon'ble Supreme Court of India in the case of MMTC Ltd. v. Medchl
Chemicals and Pharma (P) Ltd., reported in (2002) 1 SCC 234, it was
held that a complaint under Section 138 can be made not only when the
cheque is dishonoured for reason of funds being insufficient to honour the
cheque or if the amount of the cheque exceeds the amount in the account,
but also where the drawer of the cheque instructs its bank to "stop
payment". If the accused shows that in his account there were sufficient
funds to clear the amount of the cheque at the time of presentation of the
cheque and that the stoppayment notice had been issued because of other
valid causes, then offence under Section 138 would not be made out.
There is no document on record to show that the accused had sufficient
funds at the time of presentation of the cheques. Therefore, it is clear
that the accused had no sufficient funds at the time of presentation of
the cheques. Moreover the application given to the Bank for stopping
the payment of cheques in question is not produced to show that he
had any valid reasons for stopping the payment. Therefore even the
endorsement "stop payment" attracts the ingredients of section 138 of
N.I.Act.
12. The complainant issued statutory notice dated 11.07.2017
as per Ex.P.11 within time from the date of receipt of Bank Memos. The
notice was served on the accused as per Ex.P.12. The accused has not
denied the service of notice. The accused issued reply notice as per
Ex.D.13. The complaint has been filed on 17.08.2017, which is within
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limitation. The accused also admitted the cheques and signature on the
cheques. Therefore, the documents on record clearly show that the
complainant has complied the ingredients of Section 138(a) to (c) of
the N.I.Act. Therefore the presumptions U/s.118 and 139 of the N.I.Act
arise in favour of the complainant. The presumptions are rebuttable
and the burden is on the accused to rebut the presumptions. Once the
issuance of cheque is proved, the presumption arises in respect of the
fact that the cheque was issued for legally enforceable debt/ liability
and actual existence debt or liability can be contested. The accused can
rebut the presumptions by raising probable defences and proving it
relying on the evidence of the complainant or by leading his direct
evidence.
13. It is the defence of the accused in the reply notice that the
complainant and himself are good friends and had good relationship.
The complainant asked him for financial help in the business as he
suffered loss in the business. He paid Rs.20 lakhs to the complainant
for his business. The complainant had not repaid the said amount even
after his several demands for repayment and due to nonpayment his
image was spoiled in the business. It is also admitted that the
complainant is absolute owner of schedule property. He did not
approach the complainant for offering him mortgage loan. The
complainant mortgaged his property in the Bengaluru City Cooperative
Bank, Chamarajpete by availing Rs.12 lakhs loan. He paid
Rs.3,00,000/ to the Bengaluru City Cooperative Bank, Chamarajpete
at the request of the complainant. The complainant also requested him
to clear the mortgage loan availed by him in the said bank. He assured
to repay the loan by obtaining loan from other banks. Once again he
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transferred an amount of Rs.4,93,000/ to the said bank on 30.05.2017
and got discharged the mortgaged property. Later the complainant
executed mortgage deed by way of deposit of title deeds in respect of
schedule property in his favour on 29.05.2017. It was executed for
payment already made to the complainant and not for payments to be
made. The complainant further took Rs.3,10,000/ on 13.06.2017 vide
cheque bearing No.000181 drawn on Karur Vaishya Bank. The
mortgage deed was executed as security and he could not obtain loan
banks on the basis of said mortgage deed. The complainant was due to
him of Rs.35 lakhs and requested him to issue post dated cheques and
on the request of the complainant, he issued the cheques in question.
When he demanded the complainant for repayment of his money, the
complainant threatened him to present the cheques and therefore he
gave instructions to the bank for stop payment. The complainant and
his wife presented the said cheques to gain undue advantage by
misusing his cheques. The complainant is due to him of Rs.35 lakhs. He
had all the details in respect of the payments made to complainant. He
has no liability in respect of cheques in question.
14. It is the defence of the accused in the cross examination of
PW.1 as set up by the counsel for the accused that complainant
obtained loan in the Bengaluru City Cooperative Bank, Chamarajpete
and he was defaulter in the year 2017. He had mortgaged the schedule
property in the bank. The complainant asked for financial help of
Rs.10,00,000/ from the accused through one Shekhar. He took the
accused along with him to the Bank Manager and the Bank Manager
said that the repayment time can be extended on the basis of cheque of
the accused. On 31.05.2017 he gave one cheque for Rs.4,93,000/ and
11 CC.25878/2017 (J)
3 blank signed cheques to the Bank manager. The cheques given to the
Bank Manager were misused. Apart from the cheques in question, the
complainant had other two cheques of the accused. The accused paid
Rs.1,00,000/ and 2,00,000/ on 06.08.2016 an transferred
Rs.4,93,000/ to the bank through RTGS. He paid total Rs.11 lakhs to
the complainant for repayment of his bank loan. The accused gave loan
on various dates between 2014 to 2017. The accused paid amount on
various occasions by withdrawing from ATM. The accused paid entire
amount in ExD.1. The defence of material alteration of cheque at ExP.4
was also taken.
15. The accused examined himself as DW1. It is the defence
of the accused in the defence evidence that he knew the complainant
from pat 4 years and they had financial transactions. The house of the
complainant came for public auction by the bank and he paid
Rs.2,00,000/ to the bank. The complainant gave his cheque to the
bank as security in the bank premises. He transferred amount through
RTGS to the bank and stopped the auction. He got released the
complainant his mortgaged property. The complainant executed
registered sale deed in his favour in respect of the schedule property.
After the execution of sale deed, he transferred Rs.3,00,000/ to the
account of the complainant through RTGS. When he demanded for
repayment of his money, the complainant misused his cheque. He
requested the complainant to repay the amount and get the sale deed
cancelled. The complainant gave him a cheque, which was dishonoured
on its presentation to the bank for encashment. He filed case against
the complainant before ACMM, Court. He filed complaint against the
complainant to the police for offence punishable U/s.420 of IPC. He
12 CC.25878/2017 (J)
has no liability to pay the amount to complainant instead complainant
is liable to pay him.
16. In order to prove his defence, the accused got marked
Ex.D.1 to D.4. Ex.D.1 is the photocopy of mortgage deed, the certified
copy of which was already got marked as ExP.1. ExD.2 is the loan
repayment schedule issued by the Bajaj Finance Limited. It shows that
the loan of Rs.15,30,000/ was obtained on 18.02.2017 by the accused
on behalf of SLN Textiles, of which he is proprietor, but nothing else.
ExD.3 is the Letter issued by HDFC Bank to the accused. It shows that
the Bank sanctioned business loan of Rs.10,00,000/ to the accused on
17.02.2017. ExD.3 (a) is the extract showing Post Dated Cheques given
to HDFC Bank as security. ExD.4 is the bank account statement of the
accused pertaining to SLN Textiles. Ex.D.2 and 3 do not assist the
accused in any way to prove his defence. Ex.D.4 discloses that amount
of Rs.4,93,000/ was transferred to the loan account of complainant on
30.05.2017. The complainant admitted the mortgage deed at
Ex.P.1/D.1, which is executed for Rs.25 lakhs and receipt of Rs.10
lakhs from the accused. There is no document on record to prove that
the accused paid remaining Rs.15 lakhs prior to the execution of
Ex.P.1/D.1. If at all the Ex.P.1/D.1 was executed for the amount
already paid, it would have been specifically shown in the recitals of
the deed. The accused did not specifically take the defence of payment
of Rs.15 lakhs prior to Ex.P.1/D.1 and he did not specify the mode of
payment and the period of payment. The documents produced by
complainant as well as accused only show the lending of amount to the
tune of Rs.10 lakhs only. The accused did not produce any document to
show that Rs.25 lakhs was given to the complainant.
13 CC.25878/2017 (J)
17. On perusal of the oral and documentary evidence led by
both the parties, it is clear that they knew each other very well and they
had transactions. The ownership of the complainant over the schedule
property is not disputed. The mortgage of the schedule property in the
Bengaluru City Cooperative Bank Ltd., Chamarajpet, by the
complainant is not disputed. It is also not disputed that the
complainant got released the schedule property from the Bank by
availing loan from the accused. It is also not disputed that the
complainant and the wife of the complainant by name Smt.Geetha
executed the mortgage by way of deposit of title deeds as per
Ex.P.1/D.1. The complainant admitted that he received Rs.10 lakhs
from the accused as averred in the complaint. The accused also gave
evidence for having given amount to the tune of Rs.10 lakhs, though
there is inconsistencies in the oral evidences of complainant as well as
the accused. It is the case of the complainant that out of the mortgage
loan amount of Rs.25 lakhs, he received Rs.10 lakhs by way of bank
transfer and by way of cash and received four cheques i.e., Ex.P.3 to
P.6 in respect of remaining amount of Rs.15 lakhs. The defences taken
by the accused are contradictory however it can be gathered from the
evidence on record that there is no specific stand in respect of payment
of remaining Rs.15 lakhs.
18. The defence taken by the accused in the reply notice,
crossexamination of PW1 and defence evidence differ with each other
in respect of the loan of given to the complainant and issuance of
cheques. It is the defence of accused in reply notice that the loan of
Rs.20 lakhs was given for business purpose and thereafter amount was
also given for discharge of mortgage in respect of house of the
14 CC.25878/2017 (J)
complainant. It is alleged that complainant was due of Rs.35 lakhs to
the accused. However as per the defence taken in the cross
examination of PW1 the complainant sought for loan of Rs.10 lakhs
from the accused through one Sekhar and as per the defence evidence
the accused, he gave loan amount to the complainant to discharge the
mortgage in respect of the house of the complainant and specific details
are not stated. Moreover no documents have been produced to
substantiate any one of the contradictory defences. It is the defence of
accused in the reply notice that the post dated cheques were given by
the accused to the complainant at his request as the complainant was
due to the accused of Rs.35 lakhs. Thereafter when he requested the
complainant to repay the loan amount the complainant threatened him
to present the said cheques and therefore he issued instructions to the
Bank for stop payment. The defence in respect of possession of cheques
itself is not tenable. When the complainant himself is due of Rs.35
lakhs to the accused, why would he request the accused to issue post
dated cheques and why would accused consider the request of
complainant and issue the cheques in question. The defence itself is
meaningless and improbable. It appears that the said defence was
taken for sake of mere taking defence and there is no truth in it.
Further it is the defence of accused in the crossexamination of PW1
that on 31.05.2017 he gave cheque for Rs.4,93,000/ and three blank
signed cheques to the Bank Manager of the Bengaluru City Co
operative Bank Chamarajapete as security for extension of period of the
complainant to repay the mortgage loan in respect of schedule property
and the cheques were misused by the complainant. Further it is the
defence of the accused in the defence evidence that the cheques were
given to the complainant for Bank transaction as security in the Bank
15 CC.25878/2017 (J)
premises. It is pertinent to note that the defences are contradictory to
each other and either of them are not believable. Moreover the accused
failed to prove the defences by adducing cogent evidence. Nothing was
elicited in the crossexamination of the complainant in support of the
defences taken by the accused. The counsel for the complainant made
mere suggestions to PW1. He denied all the suggestions in respect of
the defence of the accused. Mere suggestions are not sufficient. Though
the dispute is in respect of payment pertaining the mortgage, the
counsel for the accused went on crossexamining PW1 as if the
complainant had given loan and he has been demanding the same from
accused. The counsel for the accused went to the extent of challenging
the financial capacity of the complainant to lend the loan, which is not
at all relevant under the facts of the case as the complainant is the
borrower of the loan and the accused is the lender. The dispute is in
respect of the nonpayment of mortgage loan amount entirely. It is the
specific case of the complainant that the accused got executed the
mortgage deed in respect of the schedule property fro rs.25 lakhs but
he paid only Rs.10 lakhs and issued cheques in question for payment of
remaining amount of Rs.15 lakhs. Under such circumstances there is no
question of challenging the financial capacity of the complainant.
19. Merely taking the defence is not sufficient. The accused
has to prove his defences by adducing the evidence. There is no oral or
documentary evidence either to show that complainant took more
amount than that of Rs.10 lakhs under the ExP.1/D.1 or cheques were
issued for security purpose. The defences are totally inconsistent with
each other.The counsel for the accused cross examined PW.1 and asked
several questions and made several suggestions in respect of the
16 CC.25878/2017 (J)
defences of the accused he gave blank signed cheques as security. If at
all the accused paid the entire amount under the ExP.1/D.1 and the
security cheques were misused by the complainant, the accused would
have taken legal action against the complainant, which has not been
done. It is pertinent to note that defence in the reply notice in respect
of the reason for the cheques being in possession of the complainant is
not at all believable. The defence taken in reply notice in respect of
giving loan of Rs.35 lakhs and issuance of cheques are appears to be
vague and not supported by any evidence. Thereafter the versions have
been changed in cross examination of PW.1 and defence evidence and
it was alleged that the cheques were issued as security. The
complainant also stood the test of cross examination and nothing has
been elicited in his cross examination in support of the defence of the
accused. Therefore the accused failed to prove his defences.
20. On the other hand it was elicited in the crossexamination
of DW1 that the cheques at Ex.P.3 to P.6 belong to him and the
signatures in the cheques are his signatures. He admitted the cheques
as well as signatures on them. It was elicited that he alleged in the
reply notice the complainant took Rs.20 lakhs loan and Ex.D.1 was
executed by the complainant for Rs.25 lakhs. It shows that there is
inconsistency in defences. He also admitted that there is a possibility of
him taking cheques from the complainant as complainant is due to him
but there is no possibility of him issuing the cheques to the
complainant. He admitted that he presented one cheque out of the
cheques taken by him from the complainant at the time of Ex.D.1 and it
was dishonored and he filed case against the complainant. Though
there is no document on record in respect of the case filed by the
17 CC.25878/2017 (J)
accused against the complainant for dishonour of cheque, the
admission by the accused makes it clear that the accused is enforcing
the payment of Rs.25 lakhs on the basis of the cheque taken at the time
of execution of ExP.1/D.1, while there is no record for payment of the
said amount except the cheques in question. It shows the conduct of
the accused. When he was asked about the filing of the complaint
against the complainant for the offence punishable U/s.420 of IPC, he
answered that he did not know about it. He further admitted that he
did not produce any documents to show that the entire amount of
Rs.25 lakhs was paid to the complainant as per Ex.P.1/D.1. Upon
considering the defences taken by the accused and the answers elicited
in the crossexamination of DW1, it is clear that the defences taken by
the accused are not probable.
21. Further on perusal of Ex.P.3 to P.6, it is clear that the
writings on the cheques and signatures appear to have written with the
same ink and at the same time. It is admitted by the accused that he
signed the cheques in question. He disputed the name and details
written on the cheques stating that blank signed cheques were issued as
security. However such aspects have no bearing on the case because as
per the presumption U/s.118(b) of N.I.Act every Negotiable Instrument
bearing a date was made or drawn on such date and as per Section 20
of the N.I.Act, if the person signs and delivers Negotiable Instrument
and it is left incomplete and thereby he authorizes the holder to
complete the Negotiable Instrument and thereby he is liable for the
amount mentioned in the Negotiable Instrument. Therefore, the
defence of the accused is not tenable. Further in view of the Judgment
rendered by the Hon'ble Supreme Court of lndia in its Criminal Appeal
18 CC.25878/2017 (J)
No.230231 of 2019 - Bir Singh V/s.Mukesh Kumar also the above
defence is not tenable. The para No.38 and 40 of the said Judgment
are extracted and the paragraphs reads thus:
38. If a signed blank cheque is voluntarily
presented to a payee, towards some payment, the
payee may fill up the amount and other particulars.
This in itself would not invalidate the cheque. The
onus would still be on the accused to prove that the
cheque was not in discharge of a debt or liability by
adducing evidence.
40. Even a blank cheque leaf, voluntarily
singed and handed over by the accused, which is
towards some payment, would attract presumption
under Section 139 of the Negotiable Instruments Act,
in the absence of any cogent evidence to show that the
cheque was not issued in discharge of a debt.
22. It is also the defence of the accused that the cheque at
Ex.P.4 is materially altered. However on perusal of Ex.P.4, it is clear
that though the date mentioned in Ex.P.4 was struck off and the date
was written above it but the cheque bears the signature of accused at
the place of correction/alteration. The said signature was not denied
and therefore it could not be considered as material alteration.
23. It is defence of the accused that the cheques in question
were given as security. However the accused has not adduced any
evidence to show that the cheques in question were given as security.
Even if the dishonoured cheques in question were issued for security,
19 CC.25878/2017 (J)
they will still comes under the ambit of Section 138 of the Act. The only
condition is that the cheque must be backed by some form of legally
enforceable debt or other liability towards the holder, which is fulfilled
as per the above discussion. Moreover, unless and until, the defence is
able to prove that the cheque was never meant to be presented for
encashment, a mere claim to that effect does not rebut the presumption
under section 118 (a) of the Act that every negotiable instrument is
made or drawn for consideration. Therefore, the burden is on the
Accused to prove that there was no legally recoverable debt or liability.
Therefore the defence of the Accused that the signed blank cheques
issued as security were misused is not tenable in view of the aforesaid
discussion and also for the reason that the Accused failed to prove the
defences raised by him.
24. The accused admitted the signatures on the cheques and
issuance of the cheques is proved as per the above discussion.
Therefore the presumption arises in favour of the complainant. The
admission attracts the ratio laid down by the Hon'ble Supreme Court of
India in its decisions reported in 2011 (11) SCC 441 - Rangappa V/s
Mohan and 2015 (8) SCC 378 - T.Vasanthakumar V/s.Vijayakumari.
The ratio is that the cheque shall be presumed to be for consideration
unless and until the court forms a belief that the consideration does not
exist or considers the nonexistence of consideration so probable that a
prudent man ought under such circumstances act upon the supposition
that it does not exist. In the case on hand the accused did not prove his
defence to rebut the presumption U/s 139 of NI Act raised in favour of
the complainant and therefore the onus has not shifted on the
complainant as per the aforesaid decision. In the case on hand no
20 CC.25878/2017 (J)
evidence was brought on record to show that the cheque was not
issued for the discharge of debt or liability. Therefore the argument of
the counsel for the accused that the complainant misused the blank
signed cheques as security is not tenable.
25. For the reasons mentioned herein above, it is crystallized
that the accused has utterly failed to prove that there was no existence
of legally enforceable debt/liability between him and the complainant
at the given point of time and he has not at all issued the instant
cheques towards the discharge of legally enforceable debt/liability of
Rs.15,00,000/. On the other hand the complainant has proved that the
accused issued the cheques for the legally enforceable debt/liability;
the cheques were dishonored due to payment stopped by drawer and
the notice issued by him was served on the accused. The complainant
proved his case beyond reasonable doubt. The accused failed to rebut
the statutory presumptions U/s.118(a) & (b) and 139 of the N.I.Act.
Accordingly the accused is found guilty for the offence punishable
U/s.138 of the N.I.Act. Hence, I proceed to answer the point No.1 in
Affirmative and Point No.2 in the Negative.
26. Point No.3 : In view of the reasons assigned in Point No.1
and 2, it is clear that the transaction is proved and the transaction is
made in the year 2017. It appears that the accused has played all the
tactics to delay the payment to be made to the complainant. The
present case is filed in the year 2017. As per the provision U/s 138 of
NI Act the Court has power to impose fine up to double the cheque
amount. That apart if the complainant would have kept the said
amount in the bank, it would have fetched minimum interest @ 6% per
21 CC.25878/2017 (J)
annum. Therefore considering the facts and circumstances of the case,
it is just and proper to impose the fine to that extent. Hence I proceed
to pass the following:
ORDER
As per the provisions of Sec.255(2) Cr.P.C. the accused is hereby convicted for the offence punishable u/s.138 of NI Act, 1881 and sentenced to pay fine of Rs.18,20,000/ (Rupees Eighteen Lakhs Twenty Thousand Only). On deposit of fine amount the complainant is entitled for compensation of Rs.18,10,000/ (Rupees Eighteen Lakhs Ten Thousand only). The remaining balance amount of Rs.10,000/ is to be forfeited to the State.
In default of payment of the fine amount accused shall undergo simple imprisonment for three months.
The personal bond executed by the accused is hereby stands cancelled and cash surety of Rs.5,000/ furnished by the accused shall be refunded to him after expiry of appeal period.
Copy of the judgment shall be furnished to the accused at free of cost.
(Dictated to the Stenographer, transcript thereof is computerized and printout taken by him, is verified and then pronounced by me in Open Court on this the 15th December2021.) (Lokesh Dhanapal Havale) XV Addl. CMM., Bangalore.
22 CC.25878/2017 (J) ANNEXURE Witnesses examined for the Complainant: PW.1 Manjunath R. Documents marked for the Complainant: Ex.P.1 Certified Copy of Mortgage Deed. Ex.P.2 Encumbrance Certificate.
Ex.P.3 to P.6 Four Cheques.
Ex.P.3a to P.6a Signatures of the accused.
Ex.P.7 to P.10 Four Bank endorsements.
Ex.P.11 Legal Notice.
Ex.P.12 Postal Acknowledgement.
Ex.P.13 Reply Notice.
Ex.P.14 Certified Copy of Bank Statement.
Witnesses examined For Defence: DW1 Umesh S. [ Documents marked for Defence: Ex.D.1 Copy of the Mortgage Deed. Ex.D.2 Certified copy of Account Statement of Bajaj Finance.
Ex.D.3 HDFC Bank Loan Sanction Letter. Ex.D.3a Statement of PDC Security cheques given to HDFC Bank Ex.D.4 Certified copy of the Bank Statement of SLN Textiles issued by the Karur Vysya Bank.
(Lokesh Dhanapal Havale) XV Addl. CMM., Bangalore.